LONDON (ShareCast) - (ShareCast News) - Tanzania-focussed mineral exploration and development company Kibo Mining announced on Monday that it has made "considerable progress" in both securing project financing and progressing the power purchase agreement with Tanzania's sole energy provider, Tanzania Electric Supply Company, in relation to its "advanced" Mbeya Coal to Power Project.
The AIM-traded firm said the MCPP is its flagship asset, which entailed the development of the Mbeya Coal Mine - a 1.5Mtpa operation based on a defined 120.8Mt coal mineral resource - and the Mbeya Power Plant, a 300MW mine-mouth power station.

It said the MCPP was being advanced to capitalise on the "acute energy deficit" in Tanzania and the wider East African region, and had received strong support from both the government and international corporates.

The company said it received formal letters of intent from multiple international power developers and financing conglomerates keen to provide "full project level equity funding" for the MCPP.

As a result, advanced negotiations with all potential project level investors to determine the optimal partners were currently underway.

Additionally, Kibo said its memorandum of understanding, as a precursor to the final PPA with TANESCO, had passed all the relevant legislative stages and was waiting for final confirmation from the Attorney-General.

The company said it anticipated updating shareholders further on progress in that area in the "near future".

It said the MoU, once signed, would provide a fixed framework within which the fundamental commercial and technical components of the PPA would be negotiated and agreed.

"Throughout the years we have enjoyed an excellent working relationship with the Tanzanian Government, and we continue to work successfully under the new mining framework," said Kibo CEO Louis Coetzee.

"Having so many global powerhouses expressing a keen interest to partner with us is a fantastic validation of Kibo, the work we've done at the MCPP - which recently won the General Electric Innovation Award - and the inherent value of the project."

Coetzee added that the government's interest emphasised that international companies had a "continuing belief" in Tanzania as an attractive investment destination.

"With the final negotiation of the PPA approaching, full feasibility studies complete and development finance on its way to being secured, this nationally significant project is reaching a tipping point that I believe will see stakeholders rewarded."

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